Japan intends to confirm over $1.83b in aid next week

39th ODA package

FHM Humayan Kabir | Published: June 03, 2018 10:21:57 | Updated: June 04, 2018 10:43:13

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Japan is likely to confirm a US$ 1.83 billion in aid for Bangladesh next week, officials said Saturday.

The money from the country's largest bilateral development partner is meant to bankroll six development projects.

Finance ministry officials said the Japan International Cooperation agency (JICA) is expected to sign a deal on Yen 200.37 billion ($ 1.83 billion) official development assistance.

The agreement signing is scheduled for June 14.

Under the proposed 39th ODA package, Japan will provide some Yen 2.65 billion loan for the Matarbari port development project.

The Yen 37.22 billion will be for Dhaka MRT line-06 construction (phase-III) project, and Yen 7.36 billion for Dhaka MRT line-05 feasibility study project.

Besides, it will lend Yen 7.93 billion for the Matarbari ultra-super critical coal-fired power plant (phase-IV) project, Yen 6.73 billion for the Jamuna railway bridge project and Yen 6.56 billion for the health service strengthening project.

Meanwhile, the Economic Relations Division (ERD) and the JICA completed their preparations for signing the agreement, a finance ministry official said.

"We are hopeful about confirming the loan under the upcoming aid package on June 14. The loan will be utilised for six ongoing and fresh development projects," he told the FE.

In March this year, a Japanese team pledged to channel the money, expressing willingness to confirm.

Headed by Japanese Ambassador in Bangladesh Hiroyasu Izumi, the team met Economic Relations Division (ERD) secretary Kazi Shofiqul Azam.

A JICA team in September-October period last year completed its mission to Bangladesh to explore the possible financing to the proposed six projects.

The official said the aid will be useful for Bangladesh as it will be utilised for developing the new and ongoing projects, including the Matarbari power plant.

"All these projects are very important for the country to ensure smooth transportation and uninterrupted power supply," he added.

The government will have to repay the loan in 30 years with a 10-year grace period.

The JICA will charge 1.0 per cent interest rate for the proposed credit.

Over the last five to six years, Japan has enhanced its aid with confirming more than US$ 1.0 billion worth of funds under each of the aid packages.

In the last 38th ODA package, signed in June 2017, the JICA also confirmed Yen 178.223 billion ($ 1.64 billion).

The credit was used for six development projects in transport infrastructure, power and water sectors.

The Japanese government offered $ 700 million (Yen 76.825 billion) for Hazrat Shahjalal International Airport Expansion project, $ 480 million (Yen 52.73 billion) for the 2nd Kanchpur, Meghna and Gumti bridges construction.

It also granted $ 50 million (Yen 5.593 billion) loan for Dhaka Mass Rapid Transit development project (Line 1).

It confirmed loans for several projects, including $ 100 million (Yen 10.745 billion) for Matarbari ultra super critical coal-fired power plant.

In June 2016, Japan signed the 37th ODA deal worth $1.50 billion (173.54 billion Japanese Yen) with Bangladesh. And in December 2015, it signed the 36th ODA package, confirming $1.2 billion concessional loan for six development projects.

Japan has provided nearly US$ 12 billion of assistance since the country's independence in 1971.


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